NSE launches Nifty500 Ahimsa index for animal-free investing
India's National Stock Exchange has debuted a new thematic benchmark excluding companies that harm animals, aiming to attract global and domestic capital seeking values-based ESG exposure.
NSE Indices Limited on Monday launched the Nifty500 Ahimsa Index, a new thematic benchmark that excludes companies involved in activities that harm animals. The index draws its constituents from the broader Nifty 500 universe, filtering the Indian equity market through the principle of "Ahimsa," or non-violence.
To build the index, NSE partnered with the Ahimsagain Foundation, utilizing its Ahimsa Investment Movement framework. This methodology evaluates corporate products, services, and operational practices to classify companies into Green, Orange, and Red bands. Stocks falling into the Orange and Red categories are systematically removed, leaving only Green band companies eligible for inclusion.
The resulting portfolio is weighted by free-float market capitalization, ensuring that liquidity and available public share float drive the index's composition. The benchmark is backdated to April 1, 2016, with a base value of 1,000. Reconstitution will occur semi-annually, allowing the index to adapt as corporate practices shift over time.
For the asset management industry, the primary significance of the launch lies in its potential as a foundation for passive investment products. NSE explicitly designed the index to serve as a benchmark for the development of exchange-traded funds, index funds, and structured solutions. This provides fund houses with a ready-made methodology to capture growing investor demand for ethically screened Indian equities.
The launch broadens the exchange's existing suite of thematic and ESG-linked offerings. "As investment preferences continue to evolve, the index offers market participants a transparent, rules-based benchmark that integrates ethical considerations with broad-based equity market exposure," the exchange said. By maintaining a broad mandate while applying a strict values-based filter, the index targets a specific niche in the sustainable investing market that goes beyond traditional environmental or governance screens.
Market participants indicated that the product could draw interest from both domestic and global capital. International funds increasingly seek to integrate non-financial criteria into their allocation processes, and a standardized, animal-free benchmark provides a clear entry point into India's diverse equity landscape.
